The Future of U.S. Energy Policy: Is There Anything We Can Agree On?

Two weeks ago, I had the opportunity to attend the 20th Annual Fall Meeting for the American Bar Association’s Section on the Environment, Energy, and Resources (SEER). The conference, held in Austin, Texas, was attended by hundreds of lawyers and professionals involved in the environment, energy, and natural resource legal fields. Unlike in previous years, the 2012 meeting was dedicated completely to U.S. energy issues, including the production of shale gas, the fate of the Keystone XL pipeline, federal energy and climate regulation, and prospects for wind and solar power.

As expected at a gathering of prominent lawyers, there was little agreement about the proper direction for U.S. energy policy. But one overriding theme did emerge: the country will continue to pursue a broad-based energy strategy. In his State of the Union address earlier this year, President Obama laid the groundwork for an “all-out, all-of-the-above strategy that develops every available source of American energy.” During the recent presidential debates, both Obama and his opponent Governor Mitt Romney indicated that the United States would continue down this path. Where the conference attendees, presidential candidates, and general public disagree is on the proper composition of an “all-of-the-above” energy policy.

So, what do we agree on?

At last week’s SEER conference, natural gas production was an immensely popular topic of discussion. Most participants, including energy regulators, leading academics, NGO lawyers, and in-house counsel for prominent energy developers, agreed that natural gas has a strong future in the United States. As shale gas begins to dominate the country’s natural gas supply, it will likely continue to displace large quantities of coal at power plants, although there are certainly environmental concerns that need to be addressed.

Regardless of who wins the November presidential election, U.S. natural gas production will remain strong. But will it help the country secure energy independence? In short, unless the challenges in using natural gas as a transportation fuel can be overcome, its contributions to energy independence will be limited. Petroleum is at the heart of the energy independence question, and currently the United States imports nearly half of the oil it consumes.

A strong natural gas market will not lessen this dependence, because very few vehicles run on natural gas. Although natural gas has had some success in large fleet vehicles, natural gas vehicles are not readily available for the general public, due mainly to an inadequate infrastructure and lack of fueling stations. For natural gas vehicles to take off, the next administration must pursue improved fuel efficiency standards and further regulation of greenhouse gas emissions.

Conference attendees also agreed that both Obama and Romney would continue offshore drilling operations, despite the recent BP Deepwater Horizon oil spill. Professor Marla Mansfield of the University of Tulsa noted astutely that executive administrations typically “go where the oil resource is located.” In other words, both an Obama and a Romney administration would consider drilling in any location where oil reserves are economically recoverable. Mansfield noted one exception under Obama—the Arctic National Wildlife Refuge (ANWR)—and hypothesized that this exception would continue in an Obama second term. Meanwhile, Governor Romney has indicated his support for opening ANWR to drilling.

There was also agreement among conference attendees that the United States needs to advance its waste conversion technology. As electricity prices rise and waste piles up, an advanced waste-to-energy (WTE) policy makes both environmental and economic sense. In recent years, Congress gave support to WTE facilities by extending the Section 45 Production Tax Credit for renewables to WTE plants, and by including WTE in the definition of renewable energy sources under the Emergency Economic Stabilization Act of 2008 (“the bailout”). There has also been significant support at the state level, with 32 states, Puerto Rico, and the District of Columbia all recognizing WTE as a renewable energy source under various statutes and regulations.

Unfortunately, broad agreement on an “all-of-the-above” national energy policy ends there.

As evidenced by the presidential debates, there are some stark differences between the two candidates’ energy policies. President Obama has been a large proponent of wind and solar power, and he sees renewable energy as the future. Conversely, Governor Romney has been highly critical of the current administration’s subsidies to renewable energy projects.

Another stark difference is in the regulation of greenhouse gas emissions. Despite a recent decision from the U.S. Court of Appeals for the District of Columbia upholding the Environmental Protection Agency’s exercised authority to regulate emissions, Romney would likely strip the EPA of this authority if elected. He would also likely instruct his EPA administrator to roll-back regulation of coal-fired power plants and focus attention on other issues. Meanwhile, many legal scholars believe that Obama, if re-elected, will pursue further greenhouse gas regulation, through either the Clean Air Act or other methods.

Currently, there is no “silver bullet” to solve all of our energy issues. As a result, an “all-out, all-of-the-above” energy policy will continue into the foreseeable future. If this is indeed our chosen path, then the public should take some solace in the realization that energy regulators, NGO lawyers, and counsel for large energy developers are all looking to quickly address the environmental and social issues associated with each specific energy source.

On the other hand, this could be taking attention away from developing a more sustainable long-term energy system that is based on renewable energy sources, energy efficiency, and smart grid solutions. We are rapidly approaching the climate tipping point, but our national policies continue to allow for large emissions of greenhouse gases. While some climate change impacts are now inevitable, we can avoid, or at the very least mitigate, some of the more severe outcomes if we pursue policies, laws, and regulations that rapidly reduce our greenhouse gas emissions.

Sean Ahearn is a Climate and Energy intern.

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